2023 (6) TMI 791 - CALCUTTA HIGH COURT

Jurisdiction of the Adjudicating Authority under the Prevention of Money-Laundering Act, 2002 - quasi-judicial statutory authority and not a Central Agency - petitioners challenges the impugned order of the PMLA authority on the ground of coram non judice.

HELD THAT:- Insofar as the objection as to coram non judice is concerned, there are two interpretations possible regarding the provisions of Section 6 of the PMLA - The one in favour of the petitioners is on the basis of sub-section (2) of Section 6, which stipulates that an Adjudicating Authority shall consist of a Chairperson and two other Members. The qualifications of the Members have also been provided in the proviso. Hence, as per the Scheme of the Act, the Adjudicating Authority has to comprise of three Members in total, out of whom one will be the Chairperson. However, it has been argued that at present the Adjudicating Authority is functioning only with a Chairperson, without any other Member having been appointed to fill the vacancies. Thus, the question of coram non judice arises - On the other hand, sub-section (5)(b) provides that a Bench may be constituted by the Chairperson with one or two Members, as the Chairperson of the Adjudicating Authority may deem fit. Hence, it is evident that the Chairperson has the discretion even to function with only one Member, which can very well be herself/himself. Proceeding on such premise, the objection as to coram non judice cannot be accepted.

Hence, on a comprehensive interpretation of Section 6, it is clear that not only has the Chairperson the discretion to constitute a Bench with only one Member, but the norm also as per Section 6(7) is that the Bench will consist of a single Member and, only if the case is of a critical nature, a Bench consisting of two Members will be assigned the hearing - In the present case, the Chairperson, as a single Member, has proceeded to take up the hearing of the application under Section 17 of the PMLA which, in the light of Section 6, cannot be held to be vitiated on the ground of coram non judice.

Apprehension of bias - Chairperson has been proceeding in hot haste and fixed the first hearing at the office of the ED, which is itself the complainant - HELD THAT:- The respondents have sought to explain away such venue by arguing that the CGO Complex, where the sitting was scheduled, houses all the offices Central Government including the ED office. Although in the Notice it was indicated that the meeting would be held in the ED office, it was held in a different Government office of the same building which was on the same floor as the ED office - That apart, the petitioners’ counsel participated in the hearing and never took the objection as to the venue.

The mere selection of the ED office as a venue in the present context, in the absence of any other clinching factor to indicate bias, would not vitiate the proceeding, more so since the matter has not yet reached the final hearing stage - Hence, it cannot be said that the Chairperson committed any jurisdictional error in himself, as a single Member, to entertain and proceed with the hearing of the application pending before the Authority.

There is no scope of entertaining the writ petition at this stage. However, in order to allay the apprehension of bias in the mind of the petitioners, a further opportunity of hearing ought to be given to the petitioners before closing the hearing on the pending interim applications - Application is disposed of by directing the Adjudicating Authority to afford an opportunity of hearing to the petitioners and/or their counsel and thereafter to pass necessary orders.